Qualcomm settles suit over political spending

San Diego telecommunications giant Qualcomm and the state of New York's comptroller have settled a lawsuit filed in January over the company's political spending disclosures.

The settlement announced Friday comes after Qualcomm agreed to post its political spending online.

“Qualcomm agrees with the New York State Common Retirement Fund that increased transparency for election-related activities by corporations is very beneficial,” said Paul Jacobs, Qualcomm chairman. “While Qualcomm has been developing a new policy on disclosure of political expenditures for some time, engaging with the Common Retirement Fund has been helpful."

New York Comptroller Thomas DiNapoli, whose office filed the civil suit in early January, praised the company's policy revisions.

“Qualcomm’s disclosure policy sets a high standard for transparency in corporate political spending disclosure and the company deserves praise for its actions,” DiNapoli said. “This is a significant milestone in greater transparency in corporate political spending.”

The updated policy provides stockholders and the public with comprehensive information regarding corporate political spending.

Qualcomm also has posted online its contributions to political candidates and political parties, expenditures to trade associations and groups that work to influence ballot measures, including $30,000 for Proposition B, the successful city of San Diego pension overhaul measure. It shows the company spent more than $2.1 million between September 2011 and September 2012.

The spending included $78,000 on state and local candidates and causes, $161,000 in federal candidate and political action committee contributions and more than $1.8 million on various trade association dues and assessments, including $385,000 with the Chamber of Commerce of the USA and $392,500 on The Wireless Association.

(Qualcomm's recent political expenditures and its corporate policy are available here. Highlights are listed at the end of the story.)

Karl Sandstrom, a former member of the Federal Election Commission and attorney for the Center for Political Accountability in Washington, also hailed the deal.

"With this new policy, Qualcomm will become a standard bearer for corporations looking to provide stockholders with transparency with respect to its political spending," he said.

The suit was believed to be the first asking a court to require full accounting of corporate political outlays following the 2010 Citizens United case in which the U.S. Supreme Court ruled that the First Amendment prohibits the government from limiting political spending by corporations and unions.

DiNapoli oversees a nearly $360 million state retirement fund investment in Qualcomm, holding more than 5.4 million shares of the company’s common stock. He had said that without knowing what the company is doing, the investment may be at risk.

Qualcomm co-founder Irwin Jacobs, who remains on the company’s board, has long been active in Democratic Party politics, donating millions over the past decade to its candidates and causes, including more than $2.3 million to political action committees last year, according to records kept by the Federal Election Commission.

After Citizens United, federal law requires disclosure of specific spending on behalf of a candidate or issue but does not require disclosure of or place any limit on other political spending, including money to so-called independent expenditure groups.

The suit contended that Qualcomm spent at least $4.7 million in lobbying efforts alone last year, a figure company officials did not dispute.

Qualcomm common stock was trading for nearly $65 a share on Friday and the company had a market capitalization value of more than $111 billion.

Political spending highlights

Qualcomm’s political spending in its last fiscal year totaled nearly $2.2 million, according to the company’s disclosures posted on its website.

It included $30,000 in support of Proposition B, the successful pension overhaul effort to shift most new city of San Diego hires into 401(k)-style programs rather than traditional retirement benefits. Qualcomm also spread money around to dozens Democratic and Republican candidates for state and federal office.

The investor-owned company’s largest expenditures between Sept. 26, 2011, and Sept. 30 of last year were for trade association membership dues and assessments. That topped out at $1,843,370.